Analysis: Changed Approach As Louisiana 'Fiscal Cliff' Nears

By 9-18-17

BATON ROUGE (AP) — Maybe Louisiana's politicians are starting to take the state's "fiscal cliff" more seriously as the $1 billion-plus budget hole edges ever closer. Or maybe they're just acknowledging the last stab at closing the shortfall earlier this year was a total failure and that their most recent tactics shouldn't be repeated.

Whatever the reason, two of the key leaders critical to getting any tax plan passed to remedy the financial gap — Democratic Gov. John Bel Edwards and Republican House Speaker Taylor Barras — seem to be taking a more hands-on approach to building a consensus ahead of the next legislative debate on Louisiana's budget woes.

More than $1 billion in temporary taxes passed by lawmakers in 2016, mainly a 1 percent state sales tax, expire on July 1. And there's no plan for how to handle the hole that will be blown in the budget.

Edwards has been traveling the state, holding closed-door meetings with business leaders and elected officials in Baton Rouge, Houma, Alexandria, Shreveport and New Orleans to outline the situation and build support for a budget-balancing fix involving taxes.

"They understand the gravity of our financial problems and are committed to finding viable solutions to address them. Party affiliations aside, it will take input from many people to develop a plan to stabilize our state budget," the governor said in a statement after his Shreveport meeting last week.

He's also started sitting down with lawmakers to solicit ideas for patching the hole, an effort that Edwards spokesman Richard Carbo said will expand once the meetings with business leaders are complete. Edwards and Barras are slated to talk face-to-face Thursday.

The House speaker, meanwhile, has been engaged in his own outreach effort, visiting with House members around the state to determine what tax proposals they would back. Barras said he hoped — and expected — lawmakers in his chamber to coalesce around tax ideas by January, with an expectation they would be debated in a special session sometime early in the new year.

By January, "I would feel comfortable that we either have a plan that makes sense to most members or have something that we need to work harder on to get another piece done, all under the realm of trying to replace a billion dollars," Barras said.

Any tax plans will require a special session to consider, but Edwards said he won't call one unless he can reach a consensus with House GOP leaders who were the primary roadblock to his previous tax proposals.

At the time they approved the temporary taxes, Edwards and the majority-Republican Legislature described it as a short-term fix to pay for services while they worked on a larger plan to overhaul Louisiana's tax structure, which has been criticized as unfair and riddled with special interest loopholes.

The tax rewrite never happened.

Ideas offered by a nonpartisan task force created by lawmakers were bottled up and killed in the House, where most tax bills must start. A separate idea pushed by the governor to enact a new business tax also was a nonstarter. Republican House leaders sought to shrink spending, but that didn't happen amid opposition from Edwards and Senate leaders.

And no one has released a detailed plan to cut $1 billion from the $28 billion state operating budget.

While Barras spoke with optimism about reaching agreement on taxes and said he was encouraged by the outreach the governor has done so far, his budget committee chairman struck an entirely different tone last week.

Appropriations Chairman Cameron Henry, a Jefferson Parish Republican, released a Facebook video that he titled "Kickoff to Fear Season," in which he slammed the governor as "constantly looking for more money" from taxpayers and using budget-cut scare tactics.

"He's not bringing business leaders in to ask them how he can help expand their business and create jobs, which is really the deficit we have. We have a jobs deficit. It's, 'How can your company give the state more money so we can continue to spend it?'" Henry said.

To say the least, Henry's video is at odds with the hopefulness coming from his chamber's leader, raising questions about whether Edwards and Barras can find consensus they both say they're seeking.

– by AP Reporter Melinda Deslatte

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